After that little side trip into the world of the Federal Funds market, let's back up to where we were before. First, I have reset the Reserves balances for Your Bank and Other Bank to $7,287,070 and $13,481,080 respectively. Second, I have reset the Effective Reserve Ratio to 1%, which comes closer to the effective ratio that exists today.

Notice that, with the same deposit liabilities, Your Bank now has $6.5 Million in excess reserves (where at 10% they had a deficit). With no other restrictions they could pump $655 Million of new money into the system (Other Bank could create $1.2 Trillion).